2025 has been a disaster for the electric vehicle industry in the United States. But as bad as it’s been, it just got a lot worse. As I documented a few days ago, The One Big Beautiful Bill that has now become law eliminates the $7,500 federal tax credit for buying a new EV, and it also kills the $4,000 credit for buying a used EV. These tax credits permanently go away in less than two months.
Irrespective of the Big Beautiful Bill, sales of EV’s were already falling way short of expectations in the first quarter of 2025, and then the bottom fell out in the second quarter of 2025.
“Electric Vehicle Sales Fall in 2nd Quarter” [WSJ – 7/02/2025]
US car buyers continue to sour on electric vehicles. Ford Motor, Hyundai, and Kia all reported steep declines in EV sales for the second quarter, with Ford saying its fell more than 30% and Kia saying sales of two models dropped by half.
Ford’s flagship electric vehicle, the F150 Conflagration Lightning pickup truck, is in a sales free fall. Ford sold just 5,842 of these abominations in Q2 of 2025, which represented a 26% decline from the already-pathetic sales volume in the prior-year Q2. 2025 Lightning sales are annualizing to just 23,000 per year, while actually trending even lower.
Now is a good time to remember that Ford built an all-new plant near Memphis to produce 500,000 electric pickup trucks per year. That plant is now mothballed and heading toward obsolescence/repurposing without having ever manufactured one vehicle. Overall, Ford’s Q2 sales were up 14% year-over-year. Maybe that Memphis plant can be refitted to build cars and trucks that people actually want to buy.
For Volkswagen, the EV sales collapse is even worse. VW sold a paltry 1,992 electric ID.4s in Q2 2025, a 65% collapse year-over-year. These sales figures are approaching what might be constituted “nominal” sales volume. VW makes some great gasoline-powered cars, but it has been so distracted with the EV push, that its entire product lineup is collapsing, with total US sales down 29% year over year. Meanwhile, most other major manufacturers are seeing increased ICE vehicle sales in the U.S. If VW doesn’t get back to focusing on cars that Americans will buy, their U.S. operations are at risk. I am a fan of VW’s non-electric cars and I would hate to see them exit the US market, but VW will have to give up the EV dream if it is going to regain lost ground.
The same story plays out with other manufacturers who made major commitments to EVs. While BMW’s overall year-to-date vehicle sales in the U.S. are up, its EV sales are collapsing, with Q2 EV sales of just 11,094 units, a 21% year-over-year decrease.
Even Tesla sales are down significantly. Elon Musk’s EV company does not break its sales out by country or region, but its global sales have been down significantly in 2025, with Q2 sales down 14%. Mr. Musk famously angered the left by aligning with President Trump to clean out government waste, which clearly caused a backlash from some of Tesla’s left-wing customer base. But those lost Tesla sales didn’t go elsewhere. They just went away, or back to ICE vehicles.
And then there is Rivian. Not only is it not gaining sales from disaffected Tesla shoppers, but its sales are going the wrong way…rapidly. Having sold right at 50,000 units each of the past two full years, the company set a guidance for about the same number of sales in 2025. Halfway through the year, Rivian has sold less than 20,000 vehicles, which annualizes to under 40,000 per year. It really doesn’t matter. Be it 40,000 or 50,000 units per year, these are the sales figures of a zombie company. Rivian’s original business plan when it seduced more than $1 billion for a proposed Georgia plant from governor Brian Kemp was to be selling hundreds of thousands of vehicles per year by now. Rivian’s Illinois plant alone can produce more than 200,000 vehicles per year. The proposed Rivian plant in Georgia was not built, but Gov. Kemp did build a beautiful “Parkway to Nowhere” in rural Georgia for it. Rivian’s sales have been tumbling with the EV tax credit in place. It will be a financial bloodbath for the company when sales plummet further - with a bigger loss per unit - when the tax credit goes away.
In fact, all of these horrible EV sales results I’ve discussed are with the $7,500 EV tax credit still in place. There may be an uptick in EV sales in Q3 due to manufacturers desperately discounting their glut of unsold electric vehicles before the tax credit goes away. In fact, they’d better make those vehicles go away in Q3, because any unsold EVs on dealer lots on October 1 will become un-moveable boat anchors.
One more quick item…
Do you remember that story a few weeks ago about a fire on a ship transporting EVs across the Pacific Ocean? The crew had to abandon ship due to the intensity of the fire. That car carrier, the Morning Midas, has now sunk.
“Cargo Ship That Caught Fire Carrying Electric Vehicles Sinks in the Pacific” [NY Times – 6/25/2025]
Three weeks after a fire broke out on the ship off the coast of Alaska, the Morning Midas sank, along with thousands of cars on board.
This is becoming a disturbing trend. Ships carrying vehicles have had occasional fires over the years, but these EV fires that are causing cargo ships to be abandoned and sometimes sink is an all-new maritime hazard. In fact, insurers were already concerned about insuring cargo ships that transport EVs. In 2022, the Felicity Ace was consumed by fire thanks to its load of EVs, and it sank. A year later, a similar fire destroyed the Fremantle Highway, which was transporting EVs.
Insurers and cargo carriers were already getting wary of transporting EVs, as evidenced by a lawsuit against VW for its role in the Felicity Ace’s sinking, which was believed to have been precipitated by an electric Porsche spontaneously erupting in flames.
“Volkswagen Sued by Mitsui OSK Lines for the Loss of Felicity Ace Car Carrier”
The ongoing debate over the safety of transporting electric vehicles is gaining new attention with reports that the owners and insurance company for the car carrier Felicity Ace are suing Volkswagen Group blaming the auto company for the 2022 fire that destroyed the vessel.
Traditional fire suppression systems aboard cargo ships are little help against the virtually unextinguishable runaway thermal fires from a load of burning EVs.
The “EV transition” is now de-transitioning. The next big conversation needs to be on where these explosive ordnance vehicles are allowed and not allowed. Following the Morning Midas’ sinking, it may become tougher for cargo lines to obtain insurance for ships carrying EVs. Insurers would also be well within their rights to deny coverage to buildings with parking garages put at structural risk by EV fires.
[buck.throckmorton at protonmail dot com]